The Law Firm of Regal and Porter Is Examining Its

Multiple Choice

The law firm of Regal and Porter is examining its client base to determine how profitable its regular clients are.Its analysis indicates that Hawthorne,Inc.paid $179,200 in fees last year,but cost the firm $208,600 ($168,000 in billable labor,supplies,and copying,and $40,600 in allocated common fixed costs) .If Regal and Porter dropped Hawthorne,Inc.as a client,and all fixed costs are unavoidable,how would profit be affected?

A) $0
B) Increase $29,400
C) Decrease $11,200
D) Decrease $179,200